Buying and selling a home can be a stressful undertaking. Sure, you can do it yourself. But do you really know everything you need to know about this complicated process? It isn’t as easy as it looks. By enlisting the services of a professional real estate agent, you can be assured that every detail you never even thought of will be taken care of by someone who will.
To find prospective agents, start with your network. Ask friends, relatives, neighbors, and colleagues for recommendations. Word-of-mouth endorsements, as always, can be priceless.
You can also turn to another trusted friend: the internet. Websites such as winnipegregionalrealestatenews.com and realtor.ca have directories that let you search for agents in your area. These databases can clue you into important details, such as an agent’s years of experience, number of homes sold, and past client reviews.
Three out of four home sellers only contact one candidate before picking their listing agent, according to a National Association of REALTORS® report. While that may be the norm, it’s smarter to shop around. Interview at least three agents before deciding on the one you want to work with.
Questions you should ask
During the interviews, ask these questions to help assess whether an agent is the right fit you:
• Do you work as an agent full-time? As in most professions, work experience doesn’t guarantee skill. That said, much of real estate is learned on the job.
• How long have you been in the business? Generally, the more experience an agent has, the more they’re tapped into the local market.
• How many homes have you sold in my neighborhood in the past year? You don’t need to find an agent who specializes only in your community, though that would be ideal. But you do want someone who has recently sold at least a few homes in your neighborhood and knows the local and hyper-local inventory.
• What’s the typical price range of homes you sell? Most agents work across multiple price points, but you don’t want an agent who has never sold a home in your range.
• What’s your fee? An agent should be able to articulate their value and explain their commission rate.
• How will you market my home? You don’t want to hire someone who’s just going to stick a For Sale sign in your yard and call it a day. The agent should present a comprehensive marketing plan for your listing. This should include strategies for staging your home, taking professional photographs of your home, promoting the listing on social media, marketing to other brokers and scheduling open houses.
• Will I be working with you directly, or with a team? Some agents lead or work as part of a sales team. The lead listing agent shares client responsibilities with other agents. Where one agent may handle private showings for a listing, another may host open houses. A benefit is that for the same fee, you get many people working for you. But if you want the sole attention of the listing agent, you may want to stick to a one-on-one arrangement.
• Will you provide one-on-one service? Whether you’re working with one agent or a team, ask how responsive they can be to you, your timeline, and your goals.
• How long on average are your listings on the market? Your average sold-to-list price? This can help you suss out whether the agent is a solid marketer and negotiator. These are real estate stats that the agent can pull from your local multiple listing service, or MLS®.
The bottom-line: It’s in your best interests to pick an agent who understands your goals, fits your personality, and can get your home sold for top dollar. When you meet someone who can offer all of the above, congratulations — you’ve found your listing agent!
Know what you’re signing up for
Now that you know what you’re getting when you find the right listing agent, let’s make sure you know what you’re committing to when you sign that agent’s “representation agreement.”
The most common type of representation agreement is the exclusive right-to-sell agreement — a legally binding contract that states you’re going to use that agent to sell your house. Under this agreement, you’re giving the agent (and the agent’s brokerage) the right to sell the home for a mutually agreed-upon time period and compensation.
You get peace of mind that you have a dedicated agent; the agent gets peace of mind that you’re only using their services. Other common terms include the agent’s duties to you, like marketing, and a dispute resolution plan.
There are other types of representation agreements, where agents don’t have exclusive rights to sell the property — meaning multiple agents can try to sell the home and compete for the commission. However, when agents know a listing is exclusively theirs, they’re fully invested in selling the property (which, again, should also give you peace of mind).
Every contract has an expiration date, but the length of the contract can vary. Some are three-months; others six months. It all depends on what you and the agent agree upon. If the contract expires before your house is sold, you can re-list your home with another agent.
Of course, there’s a chance you sign an exclusive listing agreement but just aren’t satisfied with the job your agent is doing. To protect yourself, make sure the representation agreement has a cancellation or termination clause that lets you void the contract before the expiration date without any financial penalty.
So . . . at the end of the day, how do listing agents get compensated for their work?
Real estate commissions — including the listing agent’s commission — are typically charged as a percentage of the home’s sales price. For example, on a $300,000 house, a 6% commission would cost $18,000. Commissions are negotiable. The commission is usually split between the listing agent and the buyer’s agent as well as their respective brokers.
A caveat: If an agent represents the seller and the buyer, the agent becomes a dual agent and earns both sides of the commission. In dual agency, you may have more room to negotiate the rate — just keep in mind that you’re not being represented exclusively as you are in single agency. You may want to hire an attorney to review documents and help you negotiate.
The listing agent’s commission fee often covers the cost of professional photos, marketing and marketing materials, and any administrative fees charged by the agent’s brokerage.
Also, consider this: Great agents — with their pretty photography, HGTV-worthy staging tricks, and marketing smarts — earn their keep.
So, if you’ve read all of the above, you’ve done your homework to find a great agent. Now you’re ready to sell that house.